March 24, 2010

Court Lifts FCC Media Ownership Restrictions - At Least for Now

In a victory for newspaper and broadcast companies, the U.S. Court of Appeals for the 3rd Circuit announced it will move forward with a long-running case that challenges Federal Communications Commission media ownership rules.

The court lifted its stay on the case yesterday and asked for the first briefs by May 17.
At least for now, that means FCC rules from 2007 making it easier for a company to own a newspaper and a television or radio station in the top 20 markets will go into effect.

"We are disappointed that the Third Circuit decided to lift the stay,” said Free Press executive director Josh Silver in a statement. “Vibrant local news is vital for our democracy, and without competition, newsmakers and media are less accountable.”

Lawyers who represent media companies hailed the move and said they welcome the chance to have their day in court.

“This gives a foot in the door for the first time since 2004,” said Wiley Rein name partner Richard Wiley, who represents the Newspaper Association of America and others in the case.

Tribune Co. counsel Carter Phillips, a partner at Sidley Austin, added, “The 3rd Circuit finally recognized that unless it acted, the [FCC] had no incentive to ever look at the issue, period. We’re very happy they’ve finally given us the opportunity to move forward.”

The roots of the case, Prometheus Radio Project v. FCC, go back to 2003, when the FCC under then-chairman Michael Powell repealed a 1975 ban on companies owning a newspaper and a television or radio station in the same market. The ban was replaced with new “cross-media limits” that kept some restrictions in place in midsize and smaller markets.

The move was challenged by a wide range of consumer and media watchdog groups, who argued the ownership ban is key to promoting diversity of opinion and preserving local news.

In 2004, the court found the FCC didn’t provide a proper analysis for the cross-media limits and remanded the case.

In December of 2007, the FCC adopted a more modest order, making it easier to combine newspaper and television stations in the top 20 markets. These are the rules that will go into effect.

Lawsuits challenging the rules were filed, but until now, the 3rd Circuit had held the case in abeyance.

The FCC and public interest groups requested the stay, arguing that the 2007 rule didn’t reflect the current makeup of the FCC, which has gained a new chairman and two new commissioners.

The FCC is currently considering whether the media ownership ban remains in the public interest as part of its Congressionally-mandated quadrennial review. The FCC asked that the court wait for the outcome of this process before going forward with the case.

“The order on review is certain to be superseded by an upcoming order entered by a new Commission, on a substantially different record,” wrote FCC general counsel Austin Schlick in a Jan. 7 filing with the court.

But in the end, the court didn’t buy it. “Upon consideration of the parties' status reports and the responses to the orders filed June 12, 2009, November 4, 2009 and December 17, 2009, the stay entered by this Court in Nos. 03-3388 et al., and continued in Prometheus Radio Project v. FCC, 373 F.3d 372 (3d Cir. 2004) is hereby lifted," wrote Chief Judge Anthony Sirica.

“I think the court was simply annoyed with the FCC for dragging its feet,” said Media Access Project President Andrew Schwartzman. “But it doesn’t necessarily portend the court's views on the merits one way or another.”